Tuesday 29 December 2020
London and Ankara sign trade pact
Literally the very last few meters, Great Britain succeeds in a Brexit deal with the EU. This opens the way for London to further free trade agreements. A contract worth more than 20 billion euros between the Kingdom and Turkey is causing cheers, especially in Ankara.
The British government has announced the conclusion of a trade agreement with Turkey worth 20.5 billion euros. According to information from London, the agreement is intended to create the “basis” for a regulation that enables more advantageous solutions for free trade in the post-Brexit era. Turkish President Recep Tayyip Erdogan spoke of the “most important agreement” since an agreement with the European Union in 1995.
London had to wait for a trade deal with Brussels for the post-Brexit era to be reached before the deal with the government in Ankara could be concluded. Initially, an update of the previously applicable regulations was largely agreed in order to avoid trade barriers caused by customs controls. According to the government in London, this amounts to “an important gain” for the auto and steel industries, among others.
At the same time, the path towards an agreement with “greater ambitions in the near future,” said British Trade Secretary Liz Truss. Great Britain would then be “at the center of a network of modern agreements with dynamic economies”. Both sides wanted to conclude an “even more advantageous trade agreement” in the future. The agreement that has now been reached, signed by Truss and her Turkish colleague Ruhsar Pekcan, provides for preferential tariffs for 7,600 companies that deliver goods to Turkey. Supply chains for UK auto manufacturers will be secured.
Car maker Ford satisfied
The US auto manufacturer Ford welcomed the conclusion of the trade agreement. Ford’s Dagenham branch in London supplies large parts of its diesel engines to the Ford-Otosan joint venture in Turkey, where the engines are installed in Ford transits. The trade of Ford and Ford Otosan alone accounts for more than ten percent of the trade volume between Turkey and Great Britain.
Since the UK made the decision to leave the European Union in 2016, trade deals have been signed with 62 countries, including Japan, Singapore, Mexico and Kenya. In contrast, negotiations with the USA have so far remained unsuccessful.